BERNARD MADOFF SECURITIES FRAUD

BACKGROUNDMADOFF WAS BORN IN THE JEWISH FAMILY

SEVERAL FAMILY MEMBERS WORKED FOR MANDOFF.

MADOFF STARTED HIS FIRM IN 1960 AS A PENNY STOCK TRADER WITH $5,000

HE FOUNDED THE WALL STREET FIRM BERNARD L. MADOFF INVESTMENT SECURITIES LLC IN 1960, HE WAS ACTIVE IN THE NATIONAL ASSOCIATION OF SECURITIES DEALERS (NASD), SERVING AS THE CHAIRMAN OF THE BOARD OF DIRECTORS AND ON THE BOARD OF GOVERNORS

INVESTMENT FRAUD Bernard L. Madoff Investment Securities LLC firm ran a Hedge Fund which was not registered with the SEC until September 2006.Madoff's sales pitch, an investment strategy consisted of purchasing blue-chip stocks and taking options contracts on them, sometimes called a split-strike conversion or a collar.

INVESTMENT FRAUD

A Ponzi scheme is a personality driven pyramid scam in which a charismatic individual persuades people to invest money in some bogus financial enterprise. One must do is put in their money and wait for a return. The scammer pays out a substantial amount of new money to early investors producing the illusion of reality.

INVESTMENT FRAUD

INVESTMENT FRAUD

The Bubble Burst, as ponzi scheme requires new investor for paying returns to the old investors, as investor economy was facing downturn.

Also the Economic downturn generated more redemptions than his firm could afford to pay out, which led to his confession to his sons on the evening of December 10 2008.

Reason Behind Perpetuation of Fraud

Complete Secrecy was maintained. Even those who invested with Madoff were told that the firms strategy was proprietaryMaster Marketer, his fund was considered exclusive.Annual Returns were usually Consistent. Affinity Fraud.SECs lack of due-diligence his fund was considered exclusive,Received complaints from Harry Markopolos regarding.

Size of Loss to Investors

Size of Loss to InvestorsNet fraud is around $50 billion.(Affinity Fraud) Ponzi scheme preyed heavily on Jews and destroyed the fortunes of numerous Jewish charities and institutions.Targeted more on Charity Institute Such as Steven Spielberg's Wunderkinder Foundation.Bank such as HSBC.Rich individuals Palm Beach Country ClubFeeder Funds such as Fairfield Sentry Ltd.

Sentencing Life In PrisonOn June 29, 2009, Chin sentenced Madoff to 150 years imprisonment as at the Metropolitan Correctional Center in New York Citysince federal sentencing guidelines for fraud only go up to $400 million in losses.Madoff's projected release date is November 14, 2139

CONCLUSIONInvestors should be clear regarding their investments. Investors should invest in organizations which provide their investment strategies andIts important that Investor should do research regarding their investments.

Thank you!

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